Today's Playing Catch-Up, a weekly column that dares to speak to notable video game industry figures about their celebrated pasts and promising futures, speaks to Activision co-founder and legendary game designer David Crane.

Crane was part of a group of four Atari programmers who, with the help of music industry executive Jim Levy, left the then-dominant global force in 1979 to form Activision. Activision published games for Atari's own console, the 2600, making them the world's first third-party video game publisher. At Atari, Crane and his peers were often left uncredited in the games they designed and coded, but at Activision, the games took on a more novel approach - in both senses of the word. Activision games were treated as individual pieces of art, with the author's name and, often, photograph displayed prominently on the packaging.

A Boy and his Job

Crane's early-80s output at Activision include several titles still talked about today, including Dragster, Freeway, Ghostbusters, Little Computer People, and of course, the adventurous pioneer of the modern platformer, Pitfall! (and its subsequent sequel, Lost Caverns).

"Activision became the giant of the early eighties by recognizing that a game is a creative product and requires a creative environment," Crane told Gamasutra. "Bruce Davis’ biggest mistake was treating video games as commodities, rather than creative products. I only mention this because it explains why I could no longer associate with the company."

Bruce Davis took over as CEO of Activision in 1985, and is often the subject of discontent when discussing the publisher's fall from grace, which includes the closure of text adventure giant Infocom and a move to creating business applications, which ultimately resulted in Chapter 11 bankruptcy. "After the management change, and with the working environment completely screwed up, I left the company," said Crane.

In 1985, Activision programmer Garry Kitchen spun off a game development group from Activision. "This was at the beginning of the downturn in the U.S. video game market," Crane explains, "and Activision was happy to reduce internal development costs by working with outside development houses." The company developed exclusively for Activision for three years until, in 1988, Activision failed to renew their exclusive relationship with Kitchen's group, which subsequently adopted the name "Absolute Entertainment" and became their own self-publishers.

Crane Joins Absolute Entertainment

At about this time, Crane was just finishing research work on a video game system for Hasbro Toys, and was looking to get back into proper game design. "Garry [Kitchen] and I had become friends at Activision, so I joined him at Absolute," he said. "We developed NES games, SNES games, and even a few Atari 2600 games!"

Among the titles Crane had a hand in at Absolute were Super Skateboardin', a number of early games based around the Simpsons license, and two of his own creations: A Boy and his Blob and David Crane's Amazing Tennis.

"We had a lot of fun on the development side, but under the rule of Nintendo, the publishing side of the game business was really tough. Everybody knows that video game publishers went out of business right and left in the eighties and nineties, but is seems like very few understand why."

Publishing Woes

"The U.S. game business crashed because there were no quality controls on the games," said Crane. "Anyone with a PC and an EPROM burner could develop a game and try to sell it. Few of us will forget the overflowing bins of $3.00 game cartridges in the stores – barrels of them – as stores tried to rid themselves of bad games they couldn’t sell. Nintendo entered the business with a quality-control plan. If a publisher wanted to sell games for the NES, they had to sign an agreement that let Nintendo decide what games are good enough to sell. That seemed OK at the time since everybody believes that their games are great – what better protection for the best publishers? What few people know is that this same agreement requires that all manufacturing will be done by Nintendo and Nintendo alone.

A publisher would develop a game and fight with Nintendo to convince them that it is a good game. Then, if the game passed this step, the publisher had to order all their goods from Nintendo. These goods were, of course, marked up so that Nintendo would profit from the manufacturing (Nintendo also required full payment in advance, so their profit was guaranteed). Many months later, the games arrived from Japan and were delivered to retailers across the country.

The big retailers like Toys R Us set the wholesale prices, and they set these prices lower and lower to maximize their profits. Nintendo set the cost of the manufactured goods, and those prices were set high enough for there to be plenty of profits (for Nintendo, that is). The publisher, who paid to create the game, is left with the tiny difference between the two. And if that isn’t bad enough, before the big retailer would take your newest game, they expected to return for credit any older games on their shelves. Because, after all, the newer games are easier to sell. To make a small profit, a publisher had to exactly predict how many games would sell in the market: Not to order too many (since each return comes back at full price), nor to order too few (they need to sell enough to recoup their development costs). If their estimate was off by 10% either way they were likely to lose money on the game.

Absolute fell prey to this inventory gotcha around 1994. Nobody’s crystal ball was that good."

From Absolute to Skyworks

"Garry Kitchen and I knew we enjoyed working together from Absolute, so after that we decided to join forces again," said Crane. "In 1995 the internet was just beginning to catch on. People were just beginning to ‘surf’ in large numbers. We founded Skyworks to bring games to this new, wide audience."

Skyworks Technologies, Inc. is a casual games developer and IGDA member. They are often credited with pioneering the concept of "advergaming," or developing video game content to promote a product or brand.

"Garry and I have designed and marketed games for every video game system since the 1970s, and we decided to treat the internet as a new game system. Our expertise making quality games for the early (small ROM) game systems would be invaluable in keeping game files small enough for modem download. We settled on Shockwave as a game design platform, a tool we had been using almost since its creation.

But there was a challenge. These days, consumers spend billions of dollars online without a second thought. But if you remember 1995, not only were people afraid of using a credit card online, philosophically everything on the internet was supposed to be free! To address this challenge, we came up with a new business model. We partnered with large advertisers, showing them that putting branding in a game is a good way to reach their customers. The advertiser paid Skyworks to develop a game that contained their branding; the advertiser put the game on their web site; and the consumer played the game for free. This three-way partnership works so well that shortly after Skyworks pioneered the idea, someone in the press came up with a name for it. It is now called advergaming."

Skyworks, which describes itself as a developer of casual games for cell phones, console systems, and pay-to-play web-based games, has released titles such as Texas Hold'em and Monster Trucks for Game Boy Advance, but has concentrated chiefly on advergames, producing titles for advertisers including BMW, Campbell Soup, GlaxoSmithKline, MTV, Pepsi, and Toyota,

Remembering His Roots

Crane concludes: "I still do game design and programming every day. Of course I am active in the business of games – I have almost 30 years of experience to draw upon – but gaming is my forte. I designed my first video game in 1977, and I don’t know of anyone else from that era still actively programming."

"The longer I design games, the more my career resembles that of Charles Schulz. He drew Peanuts for 50 years, almost right up to his death. I have 20 years to go..."